Africa’s biggest pay-TV group MultiChoice debuted on the Johannesburg Stock Exchange on Wednesday with shares opening at 95.50 rand, giving the company a market capitalization of 42 billion rand ($3.03 billion).



South African ecommerce giant Naspers decided to spin off MultiChoice after coming under pressure in recent years to find ways to narrow a valuation discount between its market value and that of its one-third stake in Chinese internet group Tencent.



As of 0727 GMT, the stock was trading at 105.04 rand, adding to opening gains.



Naspers did not raise any money from the listing with the 439 million shares instead being distributed to current Naspers shareholders on a one-for-one basis for its listed shares and one for five unlisted A class shares



Founded 30 years ago, MultiChoice reaches around 14 million households in 50 African countries, offering both paid-TV products and a fledging streaming service called Showmax.



The company has said there are more than 25 million households across the continent yet to be captured by its traditional pay-TV business.



The spin off leaves MultiChoice — whose strong cash flow helped Naspers evolve into one world’s biggest players in e-commerce &#8211; free to fend for itself in an increasingly competitive market where Netflix is already supplying viewers with TV content and Hollywood hits.



“This is a momentous time for our business&#8230; This marks the next chapter in our development and growth,” said MultiChoice CEO Calvo Mawela.-Reuters



-Emma Rumney

NIGERIA-SAFRICA-TELECOMMUNICATION-TV

Africa’s Top Pay-TV Group Multichoice’s Market Cap Tops $3 Billion On JSE Debut

South Africa’s Naspers has taken full control of Russia’s largest classified advertising platform Avito after it spent $1.16 billion to buy the 29.1 percent it did not already own, the media and e-commerce group said on Friday. 



It was reported earlier on Friday that Naspers was nearing a deal to buyout minority shareholders in a transaction that could value Avito at about $4 billion.



Naspers said the deal, made through its classifieds business OLX Group, implied an enterprise value of about $3.85 billion and would boost its holding in the company from 70.4 percent to 99.6 percent, with Avito’s co-founders holding the rest.



“Avito is the leading online classifieds player in Russia and our decision to increase our stake reflects our belief in the long-term prospects of this great business and the Russian internet market,” Naspers Chief Executive Bob van Dijk said in the statement.



Online marketplaces in Russia have grown rapidly in the last few years, offering anything from food delivery and cleaning to private house construction services.



Avito was launched by entrepreneurs Jonas Nordlander and Filip Engelbert in 2007 as Russia’s answer to Craigslist and today owns and operates the country’s largest online classifieds website Avito.ru.



The company’s marketplace covers a range of categories including autos and real estate and attracts more than 32 million unique visitors a month, according to its website.



Naspers has transformed itself from a newspaper publisher into an $96 billion media empire by pushing into websites and e-commerce, holding stakes in Russian internet group Mail.Ru and Chinese social network firm Tencent.



The South African company invested in Avito in 2013 by buying a 17.4 percent stake, merging in its local classified businesses and injecting $50 million in cash. The transaction valued Avito at more than $570 million.



Naspers then raised its holding to 67.9 percent, valuing the company at $2.4 billion and leaving it with four minority investors.



Separately, Avito minority investor Vostok New Ventures said it had sold its 13.2 percent stake for $540 million. Its CEO Per Brilioth said Avito had produced an internal rate of return of some 37 percent for the investor that bought into the company when it was founded.



Naspers, which had $8.7 billion in cash as of the end of September primarily from the sale of Flipkart and Tencent shares, said the deal was funded by its existing cash resources and closed on Friday.



-Esha Vaish, Arno Schuetze and Emma Rumney

gettyimages-1026624860-594×594

Naspers Takes Full Control of Russian Classifieds Website Avito

It is fascinating that many entrepreneurs fail to formulate business models, while some don’t even know what a business model is.
A simple definition of a business model is a plan for the successful operation of a business, identifying revenue sources, a customer base, products, and details of financing.
A unique business model can be the distinguishing factor that will set you apart from your competition.
If your competitors have a bigger market share, are more capitalized and better capacitated,  how can a different business model push your business ahead?
Malcolm Gladwell’s book David and Goliath looks at how David avoided fighting Goliath on his own terms, with swords and spears; he rather used what he knew best, because he could not have won if he tried to play Goliath’s game.
History has shown how the mighty often end up falling – and you can be the one to take them down.
Today, Naspers is the largest company in Africa and seventh largest internet company in the world by market capitalization. More than 60% of their value comes from their 34% shareholding in Tencent Holdings in China, but they still want to dominate in media and technolgy.
If you decide to go head-to-head with this enormous company, do not try to beat them at their own game; rather compete with them using a different approach. If you look at Apple, Google, Facebook and Amazon in Silicon Valley, they started by being disruptors.
I highly recommend that you learn the art and science of coming up with business models. Corporate companies, on average have at least four business models to make money.
The Founder and Group Chief Executive of Discovery Limited, Adrian Gore, is reported to have all his personal investments in the company. Some might think it’s risky to have all his eggs in one basket, but Discovery has diverse business models, such as medical aid, short-term insurance, and investments.
There are various types of business models. Telecom and electronics companies often use a model of prepaid or pay as you go.
Others, like MultiChoice and Netflix, use subscription, where you pay a continuous fee to access services or content.
Product to service is one of the most powerful models and is often used by tech companies. Uber, the world’s largest taxi company, owns no vehicles. Airbnb, the world’s largest accommodation provider, owns no real estate. Facebook, the world’s most popular media provider, creates no content. Instagram, the most valuable photo company, sells no cameras.
Low-touch is another model used by many retail companies, such as Shoprite and Walmart. They lower their prices by decreasing services. A similar model is Freemium, which offers basic services for free, but charges for the premium version, as LinkedIn does.
An interesting one is a reverse auction, where businesses bid for the amount they are willing to be paid for their service. The seller with the lowest amount wins.. One usually used with cars, is Leasing, where you rent than sell.
The crowdsourcing model is currently popular. This is where you get a group of people to contribute content for free, while you make money from advertising revenue; YouTube has mastered this.
Africa is excluded from these pioneering models. Eighty percent of the world’s mobile money transactions take place in East Africa, while $148 million a day is transacted every day using Mpesa and 40% of Kenya’s GDP is transacted through mobile money. Africa is powerfully positioned in this area and needs to make the most out of it.
We are living in an age with unlimited access to information. As Africans we have no excuse not to be competitive on a global scale. But, there needs to be an economic revolution in our consciousness that allows us to stand tall on the world’s stage.

Tag: Naspers

FORBES AFRICA SOCIAL MEDIA

Africa’s Top Pay-TV Group Multichoice’s Market Cap Tops $3 Billion On JSE Debut

Naspers Takes Full Control of Russian Classifieds Website Avito

A Revolution For Global Domination